Hi everybody, welcome to podcast Episode #10 of Season 2 of the Mobile Alabama Business Podcast. My name is Marcus Neto and I’m your host. This is a podcast about the people behind the business community here in the Mobile area. I know you have a lot of choices when it come to podcasts so I’d like to thank you for spending time with us today.

In this episode we had a chance to sit down with Brian Kane. Brian adds to the count of lawyers that have appeared on the podcast. Brian is no longer lawyering though. He is part of the small group that owns Fairhope Brewing Company. Fairhope Brewing Company has taken this area by storm. They have gone from making small batches to share with friends to being sold in all of the local supermarkets in just a few short years. Brian shares a lot about the struggles of trying to start a brewery in Alabama and I think there is a lot of good business advice in here as well.

So let’s dive right in with Brian Kane.

Transcript:

Marcus: To get started we normally get a little bio information from the person that is on the podcast. I know you're from Mobile, but give us a little bit more back story. Did you go to high school here or on the eastern shore? Where'd you go to school at after high school?

Brian: I've kind of been around. I lived in Mobile all through elementary school up through high school. Went to McGill for high school. Then went to Duke for undergrad, so I was in North Carolina for a few years. Moved back to Birmingham after that. Worked for a non-profit in Birmingham for a couple years. Then I went to law school in Alabama. Graduated law school at University of Alabama in 2005 and then my, then girlfriend, now wife and I, moved to Juneau, Alaska for 6 years.

Marcus: Oh, gosh.

Brian: I worked for legislature. She worked for the attorney general's office up there. We were both law school people.

Marcus: That is a far cry from Mobile.

Brian: Exactly. We are both pretty adventurous and we saw an opportunity to do something fun that ... We weren't going to do that once we had 2 kids that we have now. We knew the time was right for that if we want to try and take that kind of adventure. Job possibility opened up and I went up there and then she graduated a little bit behind me and then she came up and she found a job, again, also with the state. We didn't go up there on crab boats, fishing or anything like that.

Marcus: No, no.

Brian: We had real jobs.

Marcus: Yeah.

Brian: Just happened to be in a great place. That's really where we got interested in the beer culture because Alaska Brewing Company is one of the bigger craft breweries out there. They're mostly on the west coast and Texas is as far east as they come. They're in Juneau. If you go to Costco, you'd stop at the Alaska Brewing Company after you did your shopping, have a beer.

Marcus: Oh, wow.

Brian: Just really got into it. Then we started, on road trips, stopping at breweries. At the time, we weren't necessarily planning out that we were going to open a brewery at some point. We just enjoyed the craft beer stuff. Just from traveling around like that, once the time came and we decided to take this venture and open the brewery, we had a lot of practice of things we liked, didn't like, the styles we liked, and all that kind of thing. That's what led us back down here once we had our daughter. She lived in Alaska for about 6 months and then, at that point, our families ... My wife's from Louisiana. Our families both decided that Alaska was no longer an option.

Marcus: Yeah.

Brian: Their granddaughter was now up there. The son and daughter not as big a deal, but the granddaughter a big deal. Anyway, we moved back down, were here for a little bit, and then ended up starting the brewery.

Marcus: Very cool. How old is Fairhope Brewing Company?

Brian: A little over 3 years old.

Marcus: 3 years? Yeah. I was going to say. I know that the ability to open a brewery as a small brewing company did not exist 4, 5, 6 years ago. Right?

Brian: The laws changed. 2008 was the big change. The highest alcohol content you could have in Alabama was 5%. 2008, they raised that limit up to 13.9%. Essentially what that did, if you were to look across the board at any of these Colorado, California, anywhere ... to find that many beers below 5% is just not going to happen. You're really limiting what you can do and what kind of beer you can make. A lot of the other rules were very restrictive back then. When there's a couple breweries ... or brew pubs in Mobile, not too far from where we are right now, that just ... the law just really didn't give them an opportunity to succeed.

They changed the law in 2008 to allow for the higher alcohol content, which was a big thing, and loosened up a little more on distribution and things like that, which was when Good People and Back Forty, which are in Birmingham and Gadsden, came along once that started. When we jumped into the game, it was ... I think it was 2011, 2012. They actually changed the law again to allow for tap rooms. At that point, if you wanted a Good People beer, you got to go to the bar to get it or the store. You couldn't go to the brewery and drink the beer.

They changed that law to allow for you to sell what you made in a tap room, which was really attractive to us. That law had recently come into effect. Again, we don't know a ton about ... or at least then, didn't know a ton about making beer, so it wasn't so much, I want to get in this warehouse and sweat and whatever. It was interaction. I want to be part of a community. Once we saw that law had changed, that's when the light bulb went off that it was something that we wanted to do.

Marcus: Very good. Light bulb goes off, but obviously, there's a far cry from, hey I really like tasting somebody's recipe that they came up with, and being able to come up with my own. What was the ... Was there a learning process there?

Brian: Well, the way we went about it is, I've actually only brewed two batches in my life of beer. We were actually ... My business partner, Jim Foley, is ... we graduated law school together. We were roommates our third year in law school. We were actually at a law school reunion event for a football game and tailgating and my wife was the one that suggested we open a brewery. He had worked for a judge for a little bit and he was in between jobs and we had just gotten back down here. We kind of thought that was ridiculous. Then we started looking a little more carefully at why, at the time, there was no brewery ... Birmingham was the ... nothing south of Birmingham. Being from Mobile, I wanted to come back to this general area. Anyway, we looked into it a little more, and then Jim, my now business partner, was not on board. He didn't come on until a little bit later because he didn't necessarily buy into the idea, I guess, so much. Right around New Year's of, I guess, 2012, we sent out a couple of e-mails to some folks in the area that were in the beer world, asking about how to find a brewer. That was the big thing. Like I said, I don't know how to make beer, so ...

Marcus: You've got to know how to make beer.

Brian: I got all the business side. I had this vision of what I want it to be.

Marcus: Right.

Brian: I just don't know what's actually going to be in that glass. We got an e-mail back from our original brewer, Dan Murphy, who was working for the Mobile Press Register at the time. One of these, this is what ... I've been wanting to do something like this. Once we got somebody who could brew on board, I went met him, tasted his beers. They were all excellent. The Fairhope 51, our pale ale, is very similar to the version I had that very first day when I met him. That's actually when Jim came on board, is when I brought some beer to Jim to taste.

Marcus: He saw ...

Brian: Once he tasted it, he's like ...

Marcus: This is real.

Brian: We've got something. Yeah.

Marcus: Yeah.

Brian: I was about 3 months into the process. I had a guy that was ... actually now owns a brewery in Dothan, who was doing consulting work. He came in and consulted with me because there was ... I didn't know anything. He was a huge help, especially early on, to really get the ball rolling. I wrote a business plan and it was a page and a half. I was like, this is not what ... Nobody's going to invest in a page and a half business plan. I need to go a little farther. I got lucky with some things. Some right people stepped in to help out early on and get moving. In any business, you got to find that point of no return where you're ... You get past the hobby stage and you're like, I'm all in or I'm out.

Marcus: Yeah. There's no more playing around. I'm in this or I'm going to go get another job.

Brian: Right. The nice thing that really especially ... to open a brewery in Alabama or anywhere, the amount of paperwork is pretty obscene. Having a lawyer background, it was a lot easier for us to get through all that.

Marcus: I was going to say, that's very interesting, especially with all the legalities regarding those changes and understanding the ins and outs, the loopholes, the ... well, not loopholes. That's a bad word, but all the ...

Brian: The most efficient way to get something done.

Marcus: The efficient way to get through it. Also knowing enough about business to ... You joke about only having a one page business plan, but you also knew enough to know what it was going to take, like what the equipment costs were going to be and things like that. You don't just ... I can't imagine what the upfront costs are for opening a brewery, but I can imagine they're not cheap. All the equipment is certainly not ...

Brian: Definitely.

Marcus: Not inexpensive.

Brian: With federal permitting, you have to already have your equipment on order and a lease on a building before you can even apply to get your federal brewing permit.

Marcus: Yeah. Which is a lot of money upfront and no guarantees that [crosstalk 00:08:31]

Brian: [crosstalk 00:08:31] entry. Exactly. Big day for us was when we did get back our federal approval. It took about 4 months or so. I was never concerned about the city level or the state level. I was like, I can go to somebody's office and visit them or I can drive to Montgomery and talk to the ABC guy and find out what went wrong or what we can fix. I was like, I don't know how to ... I'm not going to drive to Cincinnati and talk to the ... where the TTB office is, which is what we file through. That was always the scary part to me. If you don't get your federal permit, then you're nowhere.

Marcus: Right.

Brian: Once we got that, it was a sigh of relief because ABC actually worked with us. I think they do it with all these guys opening up. If you ... We came to them for help like, please show us the process. What do we need to do? They were extremely helpful, so we weren't so much worried about them. Had a pretty good relationship with the city for the most part, and even better now. Yeah. That was the big hump, but you know it was nice ... What works nicely, especially the way we started was ... We had Dan, who was our brewer. His only job was to worry about the beer. Just, you make beer.

Marcus: Right.

Brian: Jim and I had the job of opening the business itself. Even then, when our business plan did actually become about 25 or 30 pages, it was about 10 pages of narrative, which is my thing. I'm an English major. Jim's an accounting major. 15 pages of Excel spreadsheets and graphs and everything else that kind of put together the whole picture because the numbers by themselves didn't say much, but obviously me just talking about how great it was going to be without real numbers out there didn't work either. Most of the folks that bought in ... We have a decent number of investors. They're all smaller percentages, but a lot of the folks that bought in are a, friends that just kind of believed in what we were trying to do. A lot of them didn't taste the beer before we opened, so they were kind of taking a leap of faith there as well.

Marcus: How long before you had that initial idea before you had that first pint in your hand?

Brian: We actually opened on January 6, 2013.

Marcus: So it was a little over a ...

Brian: Little over a year.

Marcus: Little over a year.

Brian: Which we realize now, we didn't mess around. We actually ...

Marcus: Yeah. You did pretty well.

Brian: We were pretty efficient in getting a ... That was just the idea. Not even the idea of it to be in Fairhope. We were still looking at places, just coming up with general ideas. Yeah. It really came together.

Marcus: You go through all that. You get funding. You buy all the equipment. You get the proper licenses. You put your first batch in, and it comes out, and you're holding it in your hand. What's that moment like when you are tasting the first beer from this wild idea that your wife came up with at a tailgating ...

Brian: Well, I'll tell you what's funny about it is ... The big day for us actually was not so much the day we had that beer, it's ... We brewed ... Our first batch ever we brewed on December 21st, which was the last day of the Mayan calendar, so we figured we would at least get one batch brewed if they were right.

Marcus: Sure. If everything's going to hell in a hand basket ...

Brian: [crosstalk 00:11:26] We saw something come out of it.

Marcus: Yeah.

Brian: What's interesting is ... So you get your beer in, you drop your yeast in ... In the fermentation process, yeast eats up all the sugar that's in the grain and turns that into alcohol and spits out carbon dioxide. Those are the two things that happen. In all of your tanks, you have a tube coming off that you put into a bucket of water or whatever that releases the CO2. If it's bubbling, you know the CO2 is coming out, fermentation's happening. For us, actually the biggest thing was when we came in the next day and looked at our little bucket and it was bubbling, which means ...

Marcus: It's happening.

Brian: Beer was being made.

Marcus: Yes.

Brian: That was the exciting ... Whether it tasted great or not, we were like, okay, we've done the part where there's going to be an alcoholic beverage at the end of this process. That was really just a super exciting moment for us because we weren't sure ... We didn't necessarily ... Our guy had been brewing on a little 5 gallon Igloo cooler crap pot setup. Now he's on this stainless steel that's holding 300 gallons of beer and ... Yeah. We actually ... That first batch ... I'd tell you it turned out well at the time. Looking back, we've certainly put out better products than that first day.

Marcus: Refinements. Yeah.

Brian: I think any brewery's like that. You can't really judge any place on day one, necessarily. There's always a learning process.

Marcus: It's always been something that has fascinated me, not because I'm an alcoholic, because I'm not, but the idea of starting a brewery ... I know there's a company over in Louisiana, right as you're getting to Texas that does rum and they ... I can't remember the name off the top of my head.

Brian: It's Bayou. Bayou is what they're called.

Marcus: Yeah. Bayou. It's just interesting that ... I know the red tape makes it extremely difficult, but it's surprising to me that we don't have more of that culture, like you were talking about the northwest has. There's no reason why it shouldn't be that way. I view beer like I view a chef ... or a brewery like I view a chef. Right? They may have different visions of what ... Like you brought in two today and they have very different tastes, but they're made by the same person. If I go to Von's Bistro downtown versus Noble South, I'm going to have different choices. They're going to have different visions of what their foods are going to taste like and so on and so forth. I just view brewers like that. I wish there was more of that down here.

Brian: Well, speaking of ... I think Von's is a really good example. I've been there once or twice. Recently we were there, the special was a lasagna.

Marcus: Yeah. Lasagna or twice fried chicken pies.

Brian: Everything else, you're like, what? It's a weird mix, but it's got ... There's a purpose to it. It's not like you're just ... a ten page menu where you're just flipping through the Mexican dishes and then the Italian dishes. It's particular, but it's very different, and that's ... With our beer, our blonde ale's called Everyday Ale. It's a light malty beer. Our IPA is called Take the Calls Away IPA. It's a super hoppy high alcohol beer. It's a weird question. People often walk in and they're like, what's good?

Marcus: Well, what do you like?

Brian: The answer is ... Yeah. The answer to that is a question, which is ... Yeah. What kind of beer do you like? I love Take the Calls Away IPA. If you've been drinking Miller Lite your whole life, you're going to hate this beer, so that's not the first beer for you.

Marcus: Right.

Brian: It is an interesting question. The same thing you'd walk into Von's and say, "What's good?" And they'd say, "What are you in the mood for? What do you want?"

Marcus: Point at the menu. Yeah.

Brian: Yeah. That's all that says. All good, but it is a tough question. We know. We try to go 9 or 10 beers on tap at all times. Try to keep them as different as we can.

Marcus: Give a selection.

Brian: Yeah. People can find something.

Marcus: This is a business podcast, and so I ask everybody this question, and that is, what would you say to that person that's looking to start a business, that's looking to go out on their own? Not necessarily that they're an entrepreneur, but they just want to own their own business because I view entrepreneurs and small business owners differently now thanks to Scott Tindall. He's ruined it for me. What would you say to that person? What bit of wisdom would you ...

Brian: One of the better things in general in business, I think, is a great ... seems kind of insulting to say, but I think it's a great line, which is, just because you're a chef doesn't mean you should open a restaurant. Or just because you're good at cooking doesn't mean you should open a restaurant.

Marcus: Right.

Brian: I think that's what you find. In almost any business, whatever the thing is you do is such a small percentage of the whole business thing. Every business is going to have to deal with taxes or regulations or customer service. All these other parts that don't directly relate to ... You know, we make the greatest beer in the world, but if we don't follow the rules set by the ABC or we don't provide good customer service or we don't have the marketing surrounding it ... It's a whole team effort. I think it's ... I think you got to be open to advice, criticism, whatever you want to call it. I think it's ...

Marcus: Don't mistake being good at a technical ...

Brian: Yeah. If you're a great cook, that doesn't mean you shouldn't open a restaurant. It just means maybe you should bring on a business partner who has an accounting background or who has a ... has opened another restaurant somewhere else. There's so much more management wise that goes into running a business than just doing your trade well. I think that's an important ... a really important thing. I think it's hard a lot of times when brewers try to open something by themselves. It's a lot to be worried about all your beer recipes, getting all that done, and making sure that by the 20th of each month you've paid the taxes for all the beer and keeping track. It's been a learning process for us, too, but it's ...

My industry, it's a little bit easier because everybody's willing to help the brewery. It's just not hard to find people who are interested in helping out. Other jobs might be a little more challenging to find somebody who wants to come help you with their stuff, but I think that's ... To me, again, you got to be ... You can't get so caught up in what your own vision is that you go downhill because of it. You got to be open-minded and willing to change, willing to make modifications if needed because if you just get headstrong and this is what you're going to do, then ...

People always, early on, what's our flagship going to be? Our flagship will be whatever people buy the most. I'm not going to force one beer down anybody's throat. I don't care which one it is. Maybe we don't even have one. You just get different ... Businesses do have those ... What's your this? What's your that? Maybe there's not an answer to that question right away. You find a lot of these guys ... They start out doing one thing, and then you find that this little side project that you started actually is way better than what you initially wanted to do.

Marcus: Yeah. I'm curious about what your experience has been. I own Blue Fish, but there have been times where I've been curious about what it would have been like to have a partner or partners because so often times, wearing all the multiple hats does get to be quite a bit much for one person to bear. It was obviously a conscious decision for you guys to go into business together. Was it because you knew that there was going to be a lot or was it just because you liked these guys and you knew that you were going to work well together?

Brian: Jim, in particular, we're the two managing partners. We own the biggest chunk of everything. Our investors are nicely very silent investors.

Marcus: Sure.

Brian: We send them an update every month or two or, if they're around the area, they come in. A lot of them live out of town. Most of the day to day stuff that comes down, comes down to Jim and me. One of the nice things that we have is the ability to yell at each other and then get over it, which is really nice, which usually happened in sports related stuff or the rest of law school, whether it be playing golf or croquet or whatever we were playing, we'd get in these throw downs about the rules or the ball being in or out or any other little thing, so we were used to it, so it is nice that ... We bring very different aspects to it and again, I think it's useful that either of us is not afraid to tell the other one they're not doing something the right way.

Marcus: Right.

Brian: So that when ... If I get it in my mind that we need to have this music on this night and this needs to happen, and Jim doesn't agree with that, he can point out ... at least make me make my argument as to why we should do it, which is a good process. Sometimes it does get a little tiresome, I guess, but I think it's good in the end that you're ...

Marcus: Well, it makes you stronger. Right? Because you've got to actually have valid reasons and you can't just be lazy and do things just because, well, it's just what I want.

Brian: Or things you just haven't thought of, factors you haven't considered. We try and involve all of our guys. We have 7 people now that are all working there, including Jim and me. We try and include everybody, not in everything, but you know. If we have something we're going back and forth on, we'll bring in the rest of the guys and somebody will, "What do you think about this? What do you think will be the better approach?" Looking at new beers, looking at whatever, I think it's ...

Marcus: [crosstalk 00:21:01] down the wrong path. Sometimes you need somebody else to kind of redirect you down the right way.

Brian: For me, that was always my concern was to not ... to just pick a path and not ... You get so caught up sometimes, you can't ... forest for the trees kind of thing.

Marcus: What are the last two books that you've read that you found helpful?

Brian: Sadly, I've not read very many books since I've started this particular job. I know there's books in our back area about yeast and sours and such that I have not read.

Marcus: So no books, but maybe what are some of the resources that you've [crosstalk 00:21:30]

Brian: I read ... I think it was called Brewing Up a Business, I believe was the name. It was written by the owner of Dog Fish Head Brewing Company out of Delaware, I think is where they are. That was the book I read leading into this. It wasn't so much a ... Here are beer styles, but like, here's running a brewery and here's some tips. It was a narrative. It was more of a story, but it was actually very interesting. The challenges that he had getting over the hump and the amount of work he had to put in to get his business open. It was good to read. I don't know that I took a certain thing from it and said, we've implemented that, as much as just the overall mindset that ... I think he had to go in front of the legislature to fight for laws to change for him to be able to do what he wanted to do or to be able to get some sort of change in zoning. I forget exactly what it was, but it was kind of one of these, well, if this guy where he is now had to do this starting out, then doing these things when you're starting out doesn't mean that you're not going anywhere. It just means it's sometimes getting your ...

Marcus: I would imagine there's also a lot of ... Because we see it in our industry too, where it's nice to know that the problems that you might be dealing with are things that he's also ... So there's this shared experience ...

Brian: I'm not an idiot.

Marcus: Affirmation. Yeah. I'm not an idiot. It's an affirmation that you're going down the right path. What do you like to do in your free time? Do you have any hobbies?

Brian: I try to play golf if possible. I have a 5 year old daughter and a 2 year old son, so a lot of the time off is spent doing different things with those guys. We love going down to the beach. Part of the reason we wanted to come back down this way is, my wife and I just love the water so we try and get down to Orange Beach, Gulf Shores area if we can or get out on a boat with some friends, things like that. I thought I was going to be playing a ton of golf, like I'm going to be schmoozing people, they're going to be schmoozing me, and I'll be out on a golf course three days a week. Now I'll play in a charity scramble tournament once every 4 months maybe, if we're donating beer to it. It's not quite as much as I expected, but hopefully one day I'll get my game back in line.

Marcus: Yeah. I would imagine there are big things in your future. I mean, everybody that I know that has tried your beer has said good things, so I would imagine it's just going to keep growing and growing and growing.

Brian: I certainly hope so.

Marcus: Maybe one of these days you'll be so big that you can hire people to do everything and then you can just do the schmoozing portion of it.

Brian: Exactly. Well, we've gone from 3 people to 7 probably in the last three years, so I'd say that's a decent growth rate at the moment.

Marcus: Absolutely.

Brian: Yeah. It's good. A lot of my, what you would call free time is the after hours work we end up having to do, going to events and things like that, which on the one hand, it is work, and on the other hand, there's worse work to be done out there, so I don't complain too much about having to go.

Marcus: That's cool.

Brian: Pour some samples or shake a few hands or talk about beer. Spend all my days talking about beer.

Marcus: You wouldn't have gone into this business if you didn't have an interest in it. If it's something that you enjoy, then it's a lot easier than if it was something that you hated. Tell people where they can find more information about Fairhope Brewing or even where you're physically located and social media and stuff like that.

Brian: Yeah. We're at 914 Nichols Avenue. We're right across the street, almost, from Thomas Hospital in Fairhope. We're off of 98. We're not downtown. Zoning did not necessarily permit that, but it works out great for us. We've got all the room we need. We're over there. We're at the southern part of Fairhope. As far as information, we do keep our website as up-to-date as possible, FairhopeBrewing.com, with events coming up, what beers are on tap, things of that sort, Facebook, Twitter, Instagram. I'm trying to do Snap Chat, but I don't quite get it yet.

Marcus: Yeah. I can have my middle school son come over and explain it to you.

Brian: My daughter knows how to do it. I don't have ... I'm still learning. I'm just trying to not to anything inappropriate because that seems like all the stories I hear only involve inappropriate things, so we're keeping it simple right now. We do a lot of our social media super hard to keep ... It's a great way to stay in touch with everybody.

Marcus: Absolutely.

Brian: We try to always be a hands on brewery. I think it's ... Posting behind the scenes ... not behind the scenes, but bottling day, things like that. I think people responded nicely to seeing us doing our everyday kind of work.

Marcus: They want to feel a connection to the brand.

Brian: They feel a part of it. Yeah. Any of those ways I think are the easiest, and then we're in tons of bars and restaurants all over Mobile and Baldwin County.

Marcus: I was going to say, you've exploded over the last year. I now see you in Publix, most of the restaurants down here on Dauphin Street. Saw your beers in a lot of them on the eastern shore because I live on the eastern shore.

Brian: Yep. Publix, [inaudible 00:26:29], Piggly Wiggly, convenience stores up and down. It's been a really nice response from everybody. It's not too hard to find our beer out at places. We try to make that pelican on our box stand out so it wasn't too hard to find once you got there either. If you're having trouble finding it, you can always give us a call. Jim or me will probably answer the phone and tell you where to go.

Marcus: Yeah. I want to thank you for coming on the podcast today. To wrap up, any final thoughts or comments you'd like to share with us.

Brian: Yeah. In general, we want people to ... from our perspective, obviously go out and support Fairhope Brewing Company, but small craft beer in general. There's about 20 breweries in the state now, maybe a little bit more. Not all of them are available down here quite yet, but to keep a look out for these guys. I think the more breweries you get in the state, the better the environment for craft beer gets. I think it's ... Being supportive of us, being supportive of the other guys in Alabama. We're all one big community working together at the moment. Your support of any of these Alabama guys helps us in the long haul.

Marcus: Yeah.

Brian: Thanks for having me on. I appreciate the opportunity to come and run my mouth for a little bit.

Marcus: That's what this is about. It's about businesses getting a chance to tell their story, how they got started and stuff. It's been a pleasure talking to you.